According to Stan Collender, the chance that the US goes over the fiscal cliff is now at least 75%. This rhymes with what I have been saying all along. I would put the number at 90%. The US will NOT get all of the line items to prevent the fiscal cliff approved. Some will definitely lapse and they will not be offset by any kind of tax cut or spending increase. Austerity is coming. Politically, it is miraculous that the US has resisted austerity for so long given the size of the deficit and the austerity that has already occurred in Europe. I am not making a statement in support of austerity, just addressing the political realities.
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